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Why Every Maine Business Owner Needs to Understand CGL Insurance
CGL insurance (Commercial General Liability insurance) shields your company when a third-party says you caused bodily injury, property damage, or personal/advertising injury.
What it covers:
- Slip-and-fall injuries on your premises
- Accidental damage to customer property
- Legal defense costs for covered claims
- Libel, slander, or copyright claims tied to your marketing
- Immediate medical payments to an injured visitor
What it doesn’t cover:
- Employee injuries (workers’ compensation)
- Professional mistakes (errors & omissions)
- Vehicle accidents (commercial auto)
- Cyber breaches (cyber liability)
Running a business along Maine’s coast—Wells, Kennebunk, Ogunquit, Biddeford—means crowds in summer and ice in winter. One accident can threaten cash flow and reputation.
Most small firms spend just $300–$1,000 a year on CGL, a bargain compared with legal bills that can soar into tens of thousands of dollars. It is the seatbelt every Maine business should buckle before opening the doors.
What Is Commercial General Liability (CGL) Insurance?
Imagine a customer in your Kennebunk café slips on a wet spot and breaks a wrist. CGL is the policy that pays those medical bills and hires attorneys so you don’t have to.
Core protections
- Bodily injury – covers medical costs, lost wages, and legal fees when someone is hurt.
- Property damage – pays to repair or replace items your business accidentally ruins.
- Personal & advertising injury – libel, slander, or copyright disputes tied to your marketing.
“Third-party” is key: customers, vendors, and passers-by are covered; your employees and your own property are not.
Another big benefit is the insurer’s duty to defend—skilled lawyers show up even if the claim is groundless.
For a technical deep-dive, the Insurance Information Institute offers an excellent overview.
Why Every Maine Business Needs CGL
Maine’s icy sidewalks and summer crowds mean year-round slip hazards. Legal defense alone can exceed $50,000. Landlords, event venues, and lenders in Wells, Ogunquit, and Biddeford now routinely demand proof of CGL before signing a lease or contract.
CGL Insurance in Maine: Core Coverages & Key Exclusions
Understanding when CGL insurance responds can save you from nasty surprises. Coverage starts when an “occurrence” (accident) happens during your policy period.
Key coverages for Maine firms
- Tenants legal liability – pays your landlord if fire or water from your business damages rented space.
- Medical payments – quick $5,000–$10,000 for minor injuries, no lawsuit required.
- Products liability – injury or damage caused by something you made, sold, or served.
- Completed operations – protects contractors after the job is finished.
Major exclusions to remember
- Intentional acts
- Professional errors (needs E&O)
- Auto accidents (needs commercial auto)
- Employee injuries (needs workers’ comp)
- Gradual pollution
For more detail, see our guide on General Liability Insurance Maine.
How CGL Policies Work: Occurrence vs. Claims-Made
Occurrence policies cover incidents that happen during the policy dates, even if the claim is filed years later. Straightforward and popular with most Maine businesses.
Claims-made policies only respond when the claim is both made and reported during the active policy period and after the retroactive date. Premiums start lower but rise over about five years, and you’ll need to buy tail coverage if you ever cancel or move the policy.
Who Counts as an Insured?
- Named insured – your business entity on the declarations page.
- Additional insured – landlord, general contractor, or other party added by endorsement (about $25–$50 each).
- Volunteers – sometimes covered automatically; sometimes need an endorsement.
- Independent contractors – generally must carry their own liability insurance.
Everyone else—customers, delivery drivers, tourists—is a third party that can file a claim.
Cost of CGL Insurance in Wells, Kennebunk, Ogunquit & Biddeford
Most small Maine businesses pay $300–$1,000 per year for general liability protection.
Typical annual ranges
- Home-based consultants: $300–$600
- Retail shops & restaurants: $500–$1,500
- Contractors & trades: $800–$2,000
Price factors include industry class, revenue, claims history, and deductible size. Coastal foot traffic and icy winters add some risk, but bundling CGL with property coverage in a Business Owner’s Policy often shaves 5–15% off total premiums.
Smart Ways to Lower Your CGL Bill
- Written safety and maintenance procedures
- Regular employee training
- Higher deductibles (savings of 10–25%)
- Bundle policies or choose a BOP
- Add an affordable umbrella for higher limits
- Keep a clean claims record
For a deeper breakdown, see our Maine Business Liability Insurance Cost guide.
Reducing Claim Risk & Filling Coverage Gaps
Prevention is cheaper than claims:
- Clear snow and post wet-floor signs.
- Photograph job sites and customer property before work begins.
- Review marketing content for copyright or defamation issues.
- Hire only subcontractors who show proof of insurance.
Add coverages where CGL stops:
- Professional liability for advice-related losses
- Commercial auto for business vehicles
- Workers’ compensation for staff injuries
- Cyber liability for data breaches
Different industries—from Ogunquit restaurants to Biddeford contractors—face unique risks, but the lesson is the same: CGL is the foundation, not the whole house.
Frequently Asked Questions about CGL Insurance
Is CGL insurance mandatory in Maine?
Not by state law, but landlords, lenders, and many clients require it. Operating without coverage puts your entire business at risk.
How much coverage should my Biddeford storefront carry?
Start with $1 million per occurrence / $2 million aggregate. If you have substantial assets, heavy tourist traffic, or an older building, consider higher limits or a low-cost umbrella policy.
Can I bundle CGL with other business policies?
Yes. A Business Owner’s Policy (BOP) combines CGL and property insurance, and a Commercial Package Policy can add auto, workers’ comp, and more. Bundling usually saves 5-15% and lets you manage one renewal date.
Conclusion
Running a business in Maine comes with its share of rewards - from serving our vibrant coastal communities to being part of the economic fabric that makes places like Wells, Kennebunk, Ogunquit, and Biddeford special. But with those rewards come real risks that no amount of passion or hard work can completely prevent.
CGL insurance isn't just another business expense - it's your financial safety net when life throws you a curveball. Whether it's a customer who slips on your freshly mopped floor, a delivery that accidentally damages client property, or a marketing mishap that leads to a lawsuit, general liability coverage stands between you and potentially devastating costs.
The math is simple: most Maine businesses pay between $300 and $1,000 annually for CGL coverage, but a single liability claim can easily cost tens of thousands in legal fees alone - even if you win. That's not including potential settlement costs or damage awards that could reach into the hundreds of thousands.
What makes CGL insurance particularly valuable is how it handles the unexpected. You might think your quiet bookstore in Biddeford has minimal risk, but what happens when a customer trips over a loose floorboard? Or your home-based consulting business faces a libel claim over something you posted online? These scenarios happen more often than you'd think.
At Sevigney-Lyons Insurance Agency, we've seen how proper insurance coverage makes the difference between a temporary setback and a business-ending catastrophe. Our decades of experience serving Southern Maine businesses means we understand the unique challenges you face - from seasonal tourism fluctuations that increase your exposure to harsh winter weather that creates additional slip-and-fall risks.
We're not just another insurance agency. We're your neighbors, with deep community roots and a genuine commitment to protecting what you've worked so hard to build. Our access to over 20 top carriers means we can find coverage that fits your specific needs and budget, not force you into a one-size-fits-all solution.
Don't wait until you need coverage to think about it. Every day without proper CGL insurance is a day you're gambling with your business's future. The good news? Getting protected is easier and more affordable than most business owners realize.
For comprehensive business insurance solutions custom to Maine businesses, visit our Business Insurance Coverage Maine page. We're here to help you steer the complexities of business insurance with the same care and attention we'd give our own family's business.
Remember: you can't prevent every accident, but you can protect yourself when they happen. Let us help you get the right coverage at the right price so you can focus on what you do best - running your business and serving your community.
